TransUnion CIBIL calculates and generates CIBIL reports and CIBIL scores for individuals, as well as Company Credit Reports and CIBIL ranks for companies, enterprises and organizations. The credit scores generated by CIBIL ranges between 300-900, wherein any score of 750+ and as close to 900 depicts credit responsible behavior of the consumers that further helps them to avail credit products at ease.
In the following sections, we will discuss key details about India’s leading Credit Information Company (CIC), TransUnion CIBIL and its role in the borrowing or lending process.
Role of TransUnion CIBIL in the Borrowing Process
TransUnion CIBIL is a RBI-licensed credit bureau that is authorized to collect, maintain and manage credit information, as provided by the financial institutions to generate credit reports for both individuals, as well as companies. These credit reports play a crucial role in the approval or denial of credit applications for new credit, such as loans and credit cards. The details of this process are as follows:
- Financial institutions, such Banks/NBFCs submit the consumer’s and business’s credit data or consumer information to TransUnion CIBIL i.e. details of their past credit behaviour, including account details, outstanding loan amount, repayment history, existing loan/credit card information, enquiries details related to Days Past Due (DPD) and collateral/security, if any on a monthly basis (30-45 days)
- CIBIL collates this data and uses its unique statistical algorithm to calculate and generate Credit Information Reports (CIRs) for individuals that include CIBIL Score (300-900) and Company Credit Reports (CCRs) for companies that contain CIBIL Rank (1-10)
- Lenders can check the CIBIL report and CIBIL Score/CIBIL Rank to evaluate the risk of lending to applicants and accordingly approve or reject new loan/credit card applications
- Applicants with good CIBIL score are preferred by lenders and are eligible to avail loans at low interest rates, as well as instant credit card approvals. Individuals who are new to credit, no credit history (NA)/(NH) or with low CIBIL score may able to avail fresh credit but at higher interest rates.
Suggested Read: Reasons for Rejection of your Credit Card Application